UNITED STATES OF AMERICA

UNITED STATES OF AMERICA

Before the

SECURITIES AND EXCHANGE COMMISSION

SECURITIES EXCHANGE ACT OF 1934

Release No. 101760 / November 26, 2024

ADMINISTRATIVE PROCEEDING

File No. 3-21535

In the Matter of

Quantstamp, Inc.,

Respondent.

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ORDER APPROVING

PLAN OF DISTRIBUTION

On July 21, 2023, the Commission issued an Order Instituting Cease-and-Desist

Proceedings Pursuant to Section 8A of the Securities Act of 1933, Making Findings, and

Imposing a Cease-and-Desist Order (the “Order”)1 against Quantstamp, Inc. (the “Respondent”).

In the Order, the Commission found that, from October to November 2017, the Respondent

offered and sold QSP tokens (the “Security”) to fund the development of an automated smart

contract security auditing protocol. The Commission found that the Respondent broadly

marketed the Security, including in the United States, and that the Respondent raised

approximately $28.35 million in ether and USD through the sale of the Security to more than

5,000 investors. The Commission determined that, by doing so, the Respondent violated

Sections 5(a) and 5(c) of the Securities Act of 1933 by offering and selling securities without

having a registration statement filed or in effect with the Commission or qualifying for an

exemption from registration. The Commission ordered the Respondent to pay $1,979,201 in

disgorgement, $494,314 in prejudgment interest, and a $1,000,000 civil money penalty, for a

total of $3,473,515, to the Commission. The Commission also created a Fair Fund, pursuant to

Section 308(a) of the Sarbanes-Oxley Act of 2002, so the penalty collected, along with the

disgorgement and prejudgment interest collected, can be distributed to harmed investors (the

“Fair Fund”).

The Fair Fund includes the $3,473,515 collected from the Respondent. The assets of the

Fair Fund are subject to the continuing jurisdiction and control of the Commission. The Fair

Fund has been deposited in a Commission-designated account at the U.S. Department of the

Treasury, and any interest accrued will be added to, and become part of, the Fair Fund.

1

Securities Act Rel. No. 11215 (July 21, 2023).

On October 7, 2024, the Division of Enforcement, pursuant to delegated authority,

published a Notice of Proposed Plan of Distribution and Opportunity for Comment (“Notice”),2

pursuant to Rule 1103 of the Commission’s Rules on Fair Fund and Disgorgement Plans

(“Commission’s Rules”);3 and simultaneously posted the Proposed Plan of Distribution (the

“Proposed Plan”). The Notice advised interested persons that they could obtain a copy of the

Proposed Plan from the Commission’s public website or by submitting a written request to

Catherine E. Pappas, United States Securities and Exchange Commission, One Penn Center,

1617 JFK Blvd., Ste. 520, Philadelphia, PA 19103. The Notice also advised that all persons

desiring to comment on the Proposed Plan could submit their comments, in writing, within 30

days of the Notice. The Commission received no comments on the Proposed Plan during the

comment period.

The Proposed Plan provides for the distribution of the Net Available Fair Fund4 to

compensate investors for their losses, caused by the Respondent’s misconduct, on the purchase

of QSP tokens from October 1, 2017, through July 20, 2023.

The Division of Enforcement now requests that the Commission approve the Proposed

Plan.

Accordingly, it is hereby ORDERED, pursuant to Rule 1104 of the Commission’s Rules,5

that the Proposed Plan is approved, and the approved Plan of Distribution shall be posted

simultaneously with this order on the Commission’s website at www.sec.gov.

For the Commission, by the Division of Enforcement, pursuant to delegated authority.6

Vanessa A. Countryman

Secretary

2

Exchange Act Rel. No. 101270 (Oct. 7, 2024).

17 C.F.R. § 201.1103.

4

All capitalized terms used in this Order but not defined are used as defined in the Proposed Plan.

5

17 C.F.R. § 201.1104.

6

17 C.F.R. § 200.30-4(a)(21)(iv).

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